Bus and train operator Go-Ahead, which employs around 400 people in Norfolk, Suffolk and Essex, has reported a slump in annual profits amid continuing woe for its strike-hit Southern Railway operation.

Anglianbus is part of the Go-Ahead group's Go East Anglia division, along with Konectbus, Hedingham and Chambers. Picture: Anglianbus

Go-Ahead, which runs Southern through its Govia Thameslink Railway (GTR) joint venture, saw pre-tax profit fall by 5.7% to £136.8m in the year to July 1, despite a 3.6% rise in group revenue to £3.481bn.

The group’s regional bus division – which includes the Anglianbus, Konectbus, Chambers and Hedingham fleets in East Anglia – saw revenue remain broadly flat at £376.6m against £375.7m a year earlier while operating profit fell by 2.9%, from £48.5m to £47.1m, due largely to one-off costs.

However, a stronger performance from the group’s London bus division, where revenue and operating profit grew by 7.8% and 2.1% respectively, left total bus revenue 4.5% higher at £902m and operating profit just 0.5% lower at £90.7m.

Go-Ahead said its regional bus operations had received the highest levels of customer satisfaction in the sector in the latest survey.

“Our local bus businesses are focused on improving customer experience, including making it easier to pay for travel,” it added. “During the year, the latest contactless technology was introduced across a number of our operations. We plan for contactless payments to be available to every Go-Ahead bus customer by the end of 2017.”

Profits at the rail division, which also includes London Midland and Southeastern, fell 16.1% to £59.9m on revenue up 3.2% at £2.579bn. At GTR, which also runs Thameslink, Great Northern and Gatwick Express services, revenues fell 4.1% as more than 30 days of strike action by the RMT union and six days of walkouts by drivers’ union Aslef took their toll.

The group also warned of a further hit to rail profits in the coming year after last month losing out to Abellio in the contest for the replacement London Midland franchise, and it remains in talks with the Government over contract changes which could hit annual rail profits by up to another £5m.

Go-Ahead chief executive David Brown said: “Looking back on the year, our resilient business model has enabled us to operate through challenging market and trading conditions in our bus and rail businesses.”

He added: “We apologise to our Southern passengers who have been inconvenienced for many months by disruption caused by industrial relations issues.

“Service levels are beginning to improve but there is still a lot of work to be done to provide the level of service we and our customers expect. Our primary aim is to improve the experience for our passengers and we are resolute in this commitment.”